Big wins set the stage for BEL to beat FY24 order inflow target
Bharat Electronics Ltd (BEL) have been hitting new highs of late. On Monday the state-owned aerospace and defence electronics company’s stock scaled a new 52-week high at ₹163.25. This momentum follows the announcement of significant order wins totalling ₹3,915 crore last week, including a ₹580-crore order from the Indian Army for artificial magnetic conductors (AMC) used in radars.
BEL also secured orders worth ₹3,335 crore for various defence systems, such as artificial magnetic conductors for airborne early warning & control systems, and uncooled thermal imaging sights. With this, its order inflow stands at ₹18,298 crore so far in FY24. Amit Anwani, an analyst at Prabhudas Lilladher said, “The recent order win has mitigated the risk of (BEL) falling short of its order inflow guidance, bringing significant relief and enthusiasm to investors." The company had projected an order inflow of more than ₹20,000 crore in FY24.
ICICI Securities believes BEL will receive orders worth ₹6,800 crore for fuses for the Indian Army and sub-systems for naval platforms, taking its total order inflow for FY24 to ₹25,000 crore. “As a result, we believe the management might revise up its earnings/order inflow guidance," ICICI Securities wrote in a note dated 7 December. For FY24, the company projected revenue growth of 15-17% and Ebitda margin growth of 21-23%.
Ebitda stands for earnings before interest, tax, depreciation, and amortization and is a measure of profitability. For the six months to September (H1FY24), year-on-year revenue growth stood at 6% year-on-year and the Ebitda margin growth was 22.4%. So far in 2023, BEL shares have risen by about 60%, mainly because of the government’s increased spending on defence and focus on
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